If global military expenditure is anything to go by, this will be a century of khaki and camouflage. Spending on arms and defence is at historically high levels and the experts predict more growth to come. We’ll examine why and where. Also, the new UN Arms Trade Treaty, could it ever be more than just a feel good exercise?

(Our apologies there was a small but nevertheless important error with military expenditure figures quoted in the script hence the need to correct and update the original program.)

Transcript

Journalist: Sharp new warning of all-out war: for the first time, the mysterious and secretive nation has threatened a pre-emptive nuclear strike against the US.

Journalist: Thousands upon thousands of North Koreans rallied today around a North Korean general delivering that stunning threat.

Journalist: Now to North Korea, a nation that has nuclear weapons and is tonight threatening to use them against the United States.

Antony Funnell: It was retro Cold War pantomime and it ended in...well, it ended in nothing really. But the recent military sabre-rattling on the Korean peninsula did help remind us just how easy it is for countries to start getting their backs up.

It may be hard to reconcile this with what we see on the TV news out of places like Syria, Afghanistan and even North Korea, but the world today is actually more peaceful than it has been for centuries. Still, you wouldn't know that simply by looking at the figures for global military expenditure. When you look at those figures it does seem as though the future is going to be dressed in camouflage and khaki.

Sam Perlo-Freeman: We are perhaps seeing the beginnings of a shift the balance of world military spending from the West to the rest of the world, but that's a trend that should not be exaggerated as the US overwhelming military dominance will remain.

Antony Funnell: That's Sam Perlo-Freeman from SIPRI, the Stockholm International Peace Research Institute and he's our first guest today as we examine global military expenditure and the arms trade.

Last year, according to SIPRI's latest research findings, the world spent $1.75 trillion on matters military. Now, you could put a positive spin on that figure and point out that that represents a very slight fall of half a percent on the total global expenditure for 2011.

But as Dr Perlo-Freeman points out, the long-term indicators are all heading upward, and even with last year's slight fall, military spending remains at historically high levels. Sam Perlo-Freeman:

Sam Perlo-Freeman: In fact every year from 2010 to 2012 has been higher than any previous year since the end of World War II or the drawdown immediately after World War II.

Antony Funnell: So we shouldn't get too excited about the fact that it has gone down.

Sam Perlo-Freeman: No, not really, and the reason it's gone down, a large part of this is to do with austerity programs in Europe and similar budget cuts, deficit-cutting programs in the United States, whose economic validity is highly dubious. And at the same time military expenditure is continuing to increase in most other parts of the world, just not by quite as much. But the one piece of good news of course is that the US wars in Iraq and Afghanistan are drawing down or have indeed finished in Iraq, which is one of the main factors in the decrease. On the other hand of course those countries remain extremely violent and unstable.

Antony Funnell: Of perhaps most worry seems to be the growth of military expenditure in the Asian region. China's spending is up significantly, but they are not the only ones, are they, who are spending much more on arms.

Sam Perlo-Freeman: On military spending in general, not just arms, yes. Most countries in Asia have been increasing quite substantially in recent years, including other countries like India for example. There are some exceptions like Japan, Taiwan perhaps surprisingly have both been fairly flat. This year though there are only a few other countries that are continuing rapid increases, namely Kazakhstan, Vietnam and Indonesia.

Journalist: Hundreds attended a rally in Vietnam Sunday that converged on the Chinese Embassy in Hanoi. Protesters blasted China for its recent alleged aggressions in the South China Sea. Vietnam says a Chinese vessel…

Sam Perlo-Freeman: Perhaps the most worrying trend there is the China/Vietnam situation who are rivals in the South China Sea, increasing number of incidents, perceived Chinese assertiveness or even aggressiveness, and Vietnam's increases in military spending are very clearly directed towards China. They are spending a lot on major naval equipment. It is, if you like, a sort of asymmetric arms race between the two in the South China Sea. On the other hand, a country like Indonesia, they have a policy of 1,000 friends and no enemies, and so really there military spending increases, while it can be questioned on domestic grounds, domestic priorities, is not really directed towards any other country.

Antony Funnell: China's military expenditure upped considerably, 7.8%, and Russia's has also increased by 16%, but the biggest military spender in the world is still the USA, isn't it.

Sam Perlo-Freeman: Oh yes, by a long way. By our estimates they're spending some four times as much as China, and that sort of position…I mean, the ratio may continue to go down but the US's overwhelming lead is not going to change in a hurry. And if you look beyond the spending figures to actual military capabilities, then that lead is even greater. For example, the United States has 11 aircraft carriers, fully fledged with full battle groups around them. The Chinese have one which is largely a training platform decades behind in technology and they've just started building another. So again, the technological capability gap is closing, but it is considerably larger even than the military spending gap. It takes time for spending increases to actually translate into sustained capability increases.

Antony Funnell: So those who speculates that China is rapidly reaching parity or getting close to the US in terms of its military capability, they certainly seem to be off the mark, don't they, according to these figures?

Sam Perlo-Freeman: Not in the same league. The more relevant question from China's point of view, they are not trying to match the United States, they know they can't any time in the next couple of decades, what they are perhaps aiming for is a situation where in the event of a localised conflict, for example over Taiwan, that the US couldn't have it all its own way…that their spending on things like anti access area denial capabilities that the United States are quite worried about that would prevent the US's overwhelming naval forces from operating freely in the area around China, around China's coasts and areas like the South and East China Sea. So that's not a question of matching the US ship for ship, plane for plane, technology for technology, but, again, asymmetric capabilities that would blunt the US's overwhelming advantage.

Antony Funnell: Sam Perlo-Freeman from the Stockholm International Peace Research Institute, and on our website you'll find a link to SIPRI's newly released analysis of global military expenditure for 2012.

Now, just to reinforce Dr Perlo-Freeman's last point there about China-US military rivalry and the misperceptions that abound, it's worth reinforcing that while China's military expenditure has been steadily increasing, it still only accounts for 9.5% of total world spending. 9.5%. Whereas the US in 2012 accounted for a full 39%.

And here's another figure worth bearing in mind when looking at the global military scene; the current US military budget is 69% greater than it was in 2001. 69%.

So for the immediate future at least, in sheer dollar terms, the American military reigns supreme. But that's not to say that things in the US are static. The American military is currently undergoing a shake-up. Retired Lieutenant General David Barno was the head of Combined Forces Command-Afghanistan from 2003 to 2005 and he's now an Advisor and Senior Fellow at the Center for a New American Security in Washington.

David Barno: You may know the US made some arrangements here about two years ago with the Budget Control Act of 2011 that would require the Congress and administration to find a certain level of cuts, about $0.5 trillion in cuts over 10 years, and if they were not able to find those cuts that there will be automatic cuts of the same size that would come into place. Well, those have now triggered, as of 1 March, and we're seeing about a 10% cut back in defence spending here this year and cuts that will continue for about the next nine years that will add up to somewhere between $450 billion and $500 billion over 10 years. That's a fairly big chunk out of a sizeable defence budget but one that is certainly going to be felt in the US defence establishment.

Antony Funnell: Will it be felt though with frontline troops, with the actual military effectiveness of the US on the ground, or will this really be cuts predominantly to the bureaucracy, if you like, that supports the military?

David Barno: That's a key question. Secretary Hagel in his first month or so on the job is the new secretary of defence, he's recently made a speech here in Washington that called for cutting the world's biggest back office, as he put it, trying to get at some of those structural expenses in the Defence Department from large staffs to acquisition costs, to the numbers and layers of headquarters across the US military. And he very much wants to cut that overhead before he goes after the front-line units. But our historical past would indicate that inevitably force structure and units get pulled out when we are trying to save money when we are doing draw-downs after our wars. So I'm concerned about that but I know that he is the right track with that but it will be very difficult to push that through.

Antony Funnell: It is still the case though, isn't it, that the US is spending more on its military year by year than it has in the past. So the military expenditure has been going up over the last couple of decades.

David Barno: It has, but as we've looked at that here in our think tank, we've assessed…it's mentioning numbers, and we find that actually some of the biggest drivers of those costs aren't weaponry or training or even somewhat of the increase in troops that we've seen in the build-up for Afghanistan and Iraq but actually the costs are primarily personnel costs, pay benefits, health care, those costs have soared in the last decade. Today it costs 1.5 times what it cost in 2001 to put an American soldier in uniform, and those numbers are continuing to grow. That is actually stripping out a lot of the buying power of the defence dollar here in the US.

Antony Funnell: President Obama has already signalled a greater emphasis for the US in Asia in coming years. What will that realistically mean in terms of the deployment and direction of US military resources?

David Barno: We're seeing the front end of that already. We're seeing the deployment of some additional littoral combat ships, the LCS as they're called, in Singapore we have three new US Navy ships are being based out there. We've seen the commitment now for Australia to host up to 2,500 US Marines in Darwin on a rotational basis here and there's a couple of hundred marines up there now. So I think the beginnings, the front end of this are already starting to happen. At the same time I should remind your audience we still have 60,000 Americans fighting in Afghanistan, so there is still a very large conflict under way that is consuming a lot of American military manpower. So you can expect to see this shift in the Pacific play out over the next several years, not to abruptly arrive on scene on 1 January next year or any time near that.

Antony Funnell: Okay, so a summary of what we've heard so far. Well, despite a slight dip in 2012, military expenditure around the world has been on the rise, it's now $1.75 trillion dollars and all but certain to go up.

Point two; despite much recent media coverage to the contrary, China's military spending, though up significantly, is nowhere near that of America's. They won't be a military match for the US anytime soon. And the United States, accounting for just on a quarter of all military spending, is going to continue be the dominant force in the world for decades to come.

And finally, the most significant growth area for military expenditure in recent years according to SIPRI is Asia, a fact that comes as no surprise to Rory Medcalf, the director of the International Security Program at the Lowy Institute for International Policy in Sydney.

Rory Medcalf: Well, it is going to be an Asian century I think in more ways than one. I think the mistake we can make is to assume that an Asian century just means peace and prosperity, growing middle classes, better living conditions for all and so forth. But there is a potential downside to the increasing economic weight and development of Asian powers, of China and India in particular, and that's because now these countries can afford much bigger militaries, these countries already have continuing strategic tensions and rivalries, and some of these tensions are actually worsening as these countries become more wealthy. So in some ways the Asian century will involve stronger, wealthier Asian powers having more to compete for or having more reasons to clash with one another, and having the hardware, having the wherewithal to really fight more dangerous conflicts than in the past. So that's the downside of the Asian century that I see.

Look, it's an unfortunate reality that most of the serious strategic flashpoints in Asia do have something to do with the rise of China. They are around China's maritime periphery in particular. Really if you look everywhere from Korea down through the East China Sea, South China Sea, and even around to the China-India border, there is I guess almost a ring of tension around China. Perhaps China-Russia is the only one of those relationships that is relatively trusting. I think there is a great degree of strategic mistrust between China and other powerful states in Asia, for all sorts of reasons, including literally uncertainty about how a powerful China is going to behave in the future. I'm not saying that China has a grand plan, I'm not even sure the Chinese leadership knows how powerful China will behave in future. But history tells us that if a great power rises and doesn't take steps to manage mistrust with its neighbours and with other powers, then there can be very, very dangerous consequences.

Now, I do see a tendency of other countries to balance against Chinese power, to join forces in one way or another. This does not amount to formal alliances. We're not seeing NATO in Asia where all sorts of countries band together in a grand alliance, committing to defend one another against a potential challenge from China. But we are seeing a more complex and sophisticated form of balancing. We are seeing countries strengthen their alliances with the United States one by one; Australia, Japan, South Korea, the Philippines and so forth. We're seeing countries form soft partnerships with the United States that are not an alliance but do involve a degree of military cooperation. So we're seeing the United States and India, we're seeing the United States and Singapore, the United States and Vietnam, for example, developing these relationships that are one or two steps short of an alliance.

We're also beginning to see finally a new form of strategic relationship in Asia where countries that are US partners or allies or not even US partners or allies are forming bonds with at least one or two other countries. The term for this is mini-lateralism, it's not an inclusive agreement like multilateralism, it's not countries acting on their own or in ones and twos, but we are seeing unusual new formations of three or four countries springing up where they agree to share their strategic assessments with each other, perhaps a limited degree of military corporation. We are seeing the United States, Japan and India experiment with this. We're seeing Australia, the United States and Japan experiment with this. We've even seen a limited experiment in the past, a quadrilateral experiment between the United States, Japan, India and Australia, perhaps with Singapore thrown in, balancing against Chinese power.

Now, the Chinese don't like this, this tends to heighten the fears within China that China is being encircled, and I do think we need ways around this, ways to manage it. But the fact is that as countries feel that their own military capabilities, their own power is being eclipsed by a rising China, they are going to take steps to protect their interests, and this could be unsettling.

But I do think that we have to remember, America still remains the greatest military power in the world. That if you, for example, count nuclear weapons and some of America's other capabilities, and especially if you count America's ability to craft alliances and partnerships, then America still has a lot more staying power in Asia in the years and decades ahead.

Antony Funnell: Rory Medcalf, thank you very much for your time.

Rory Medcalf: My pleasure.

Speaker: Draft resolution A/67/L.58 is adopted.

Journalist: When the vote came, it was overwhelming. The first comprehensive treaty seeking to establish rules for the international arms trade was carried by a significant majority. It reflected years of painstaking work by governments and activists.

Antony Funnell: An international treaty to regulate the global trade in arms was approved by the UN in early April. 154 nations supported it and only three voted against it; North Korea, Iran and Syria.

UN speaker: We have produced a strong text that fulfills a mandate given to us by this General Assembly. We believe that an effective implementation of this Treaty will make a real difference for the people of the world.

Antony Funnell: Like global military expenditure, the amount of money generated by the global arms trade is huge. And according to the latest data from SIPRI, the Stockholm International Peace Research Institute, China and Asia are once again a significant focus of interest.

In the period between 2008 and 2012 the Asian region accounted for almost half of the global imports of major conventional weapons. And China...well, China is now one of the world's five biggest arms suppliers. Dr Paul Holtom from SIPRI:

Paul Holtom: In the past two decades since the end of the Cold War the top five major suppliers has been traditionally dominated by the US and a number of European suppliers; Russia, Germany, France and the UK. They've tended to make up between three-quarters to 80% of the volume of arms exports globally. What we've seen in recent years, and this comes out in the five-year period for 2008 to 2012, is a dramatic increase by China in terms of the volume of arms exports. The last time we saw China in the top five was back at the end of the Cold War thanks to the Iran-Iraq war, this time it's there largely thanks to exports to Pakistan. And actually when one looks at all the major exporters, a large share of their exports are to Asian states.

Antony Funnell: According to your report, the volume of Chinese arms exports has risen by 162% over the past half-decade. So is that assigned the Chinese government sees the arms industry as an economic priority area for expansion?

Paul Holtom: I think it's more than that. They see it also in terms of building political relationships, they are also looking at security interests themselves. Some of this information that we gather is also based upon donations and not just exports and sales. So it's not just an economic aspect. And also we believe that it's also connected with gaining access to resources and markets as well, in commercial goods, and not purely military either.

Antony Funnell: Paul Holtom from SIPRI. So if the armaments trade is booming, it's timely then that we now have the UN Arms Trade Treaty to try and impose greater regulation on the movement of weapons.

The only problem is there are serious doubts about just how effective the UN Treaty will be. It still needs 50 states to actually ratify it in order for it to come into effect. And while 154 countries at the UN voted in favour of the treaty, there were also a large number of abstentions; 22. And among those who declined to commit were two of the major exporters; China and Russia. So the question is; without China and Russia, can the treaty ever really have significance?

Dr Binoy Kampmark from RMIT University in Melbourne is a specialist in law and international relations

Binoy Kampmark: I think the answer is very much in your question, the answer is precisely that if the major exporters are not included in the arrangements, then the treaty has no teeth. I might also point out that along with China and Russia, major exporters, we've got the other side of the coin, we've got major importers. India, for example, abstained as well, and the Indian argument about it was very striking because it demonstrates how complex the issue actually is…the Indian delegates feared that the treaty itself would be used as a weapon to discipline countries who are importing because, let's face it, importers will want to get the best weapons, the best types, and these may not always come from so-called state-sponsored entities, they might come from private armaments firms, and sometimes there are certain types of weapons that will be regarded as very problematic, shall we say, to export to certain countries. They may not be on the so-called good list, an approved list of importers. And India is afraid that they will be discriminated against because they are such great importers of weapons.

Antony Funnell: An important point to tease out in what you've just said is the fact that it's one thing to talk about the trade that is aboveboard in arms in the world, but we know that there is a massive illicit trade in arms, isn't there, and that's not going to necessarily be taken into account by this treaty, even if it does come into affect anytime soon, is it?

Binoy Kampmark: No, it can't. I think we have a situation in point where there are numerous embargoes that are in place, be it embargoes for instance regarding North Korea, be it embargoes regarding Iran. These embargoes are essentially hollow. Again, armaments will find ways, as it were, of transiting through. There will be groups that will always be able to bypass these embargoes. A classic case in point is that there have been scouting exercises done, weapons-watching if you like, about the sorts of weapons that are turning up in the Syrian conflict, and some of these should not have been in the hands of the individuals using them, namely the al-Nusra Front, which is regarded by countries such as the United States and Australia as a hard-core terrorist organisation. And yet the fact is that these weapons were designated for a different group, a more moderate faction of the Syrian opposition army, and yet we find weapons of course, unsurprisingly, finding their way into the hands of individuals that are not approved, as it were. And that's where the treaty lacks bite and has problems because there is no way that it can actually guarantee the security and the credibility of weapons transfers and imports and exports.

Antony Funnell: We've talked about two of the really big exporters of arms—China and Russia—they abstained. There was also the US of course and it decided to vote for the treaty, but I understand you have doubts about whether or not they will actually go that next step and ratify. What's the issue there?

Binoy Kampmark: The issue there is an issue that the United States has had with international treaties in its history. There always has been a groundswell of domestic opposition to various international treaties, and the trade treaty that has been passed in the General Assembly is no exception. There has been very vocal opposition in the Senate to this, and of course the Senate is the body that will ratify the treaty. It's fine for President Obama to be appending his signature to an agreement, but to make it part of US law and to make US citizens bound by it, there will need to be a formal ratification process in the Senate, and of course let us not forget that a very vocal group against the treaty is the National Rifle Association which sees this as curtailing or possibly curtailing the entitlement to bear weapons.

Antony Funnell: So the argument would be if the Americans are ready having problems within their own country at regulating arms, why would they actually sign an agreement for arms regulation overall on a global scale? Is that correct?

Binoy Kampmark: Yes, it has been certainly said that that's a curious inconsistency. On the one hand they have huge domestic problems regarding the control of weapons, and I might add that that's a situation where it demonstrates a legal market in the main, it's that many individuals who are using or have access to weapons, extraordinarily devastating weapons that would actually be outlawed by the treaty of the UN, are themselves demonstrable of this idea that a legal market is a very lethal market. So just because one has a legal market and cleans up the distribution of weapons doesn't actually inspire confidence that it might actually end this spectre of weapons falling into the wrong hands. The fact of the matter is we're looking for legalising a market that is designed for one fundamental thing, which is killing.

Now, there were a lot of facts and figures in this show, don't forget we do offer a transcript which you can get by going online, just search RN and Future Tense, or go to the RN website, abc.net.au/radionational, and follow the prompts.

And remember, also on our website you'll find the Future Tense glossary, explanations of terms and concepts used on the show, and details about the Future Tense book, The Future and Related Nonsense, which is available online or through bookstores in Australia.

Guests

Dr Paul Holtom

Director of the Stockholm International Peace Research Institute's Arms Transfers Programme.

Dr Sam Perlo-Freeman

Director of the Stockholm International Peace Research Institute's Programme on Military Expenditure and Arms Production.

Rory Medcalf

Director, International Security Program at the Lowy Institute for International Policy. Non-resident Senior Fellow in Foreign Policy at the Brookings Institution in Washington DC.

David Barno

Lieutenant General, USA (Retired) and Senior Advisor and Senior Fellow at the Centre for a New American Security.

Credits

Comments (3)

perspective :

06 May 2013 1:11:27pm

Great time for Australian defense spending to be at its lowest level. since just before WWII and we all know what happened next. especially with the UK's and Americas new found disdain for a new war. the rest of the world seems to be getting ready for expansion.

Anthony Alfidi :

08 May 2013 8:28:45am

China's assertiveness means Asian democracies need the US as a deterrent. The Asia-Pacific region will get hotter: http://thirdeyeosint.blogspot.com/2013/04/naval-war-college-foundation-seminar-in.html